S&P 500 PE Ratio, 1920–Present

Findings

The latest reading puts the S&P 500 at 26.36× trailing as-reported earnings — above the 80th-percentile High PE line of 22.12, so the market has been this expensive or pricier in fewer than one in five of all months since 1920. The High/Low band brackets a long-run median of 16.52, but valuations cluster by era rather than oscillate evenly: decade averages sat between 11 and 18 from the 1920s through the 1980s, then re-anchored higher — 21.64 in the 1990s, 31.39 in the 2000s, 26.44 in the 2020s to date. Only 41 of the 429 months since 1991 fell below the median — clustered in the mid-1990s and the 2010–2012 post-crisis stretch — and the index has not touched the Low PE line since January 1985. The dot-com era holds the endurance record: from July 1997 to February 2004 the ratio spent 80 consecutive months above the High PE line. The extremes are denominator artifacts as much as price stories — the 123.73 record of May 2009 reflects trailing earnings collapsing in the Global Financial Crisis faster than prices fell, while the 5.82 trough of June 1949 shows how cheap post-war valuations once were.